The Arbitration and Conciliation (Amendment) Bill, 2019 (“2019 Bill”) is largely the same as the Arbitration and Conciliation (Amendment) Bill, 2018.
The 2019 Bill seeks to establish an ‘Arbitration Council of India’ for the purpose of grading of arbitral institutions and accreditation of arbitrators.
The 2019 Bill proposes to amend the start date for the computation of the 12-month time-limit for completion of arbitral proceedings to the date on which the statement of claim and defence are complete.
The 2019 Bill exempts international commercial arbitrations from the 12-month time-limit.
The 2019 Bill further introduces provisions on confidentiality of arbitral proceedings and immunity for arbitrators.
The 2019 Bill prescribes minimum qualifications for a person to be accredited/act as an arbitrator under the Eighth Schedule.
The 2019 Bill statutorily overrules BCCI v. Kochi Cricket and clarifies that Arbitration and Conciliation (Amendment) Act, 2015 would apply only to such proceedings where the arbitration commenced post October 23, 2015.
The President of India has given his assent for the latest amendments in the Arbitration and Conciliation Act, 1996 and the same has been published in the Official Gazette of India as the Arbitration and Conciliation (Amendment) Act, 2019Establishment of the Arbitration Council of India
Tied in with the introduction of arbitral institutions is the creation of the Arbitration Council of India which, in terms of the provisions of the 2019 Amendment, has been modelled as a premier arbitration regulator/overseer performing various functions for promoting, reforming and advancing the practice of arbitration in the country. In the furtherance of this goal, the Arbitration Council of India has been given powers inter-alia for grading arbitral institutions, recognizing professional institutes providing accreditation of arbitrators, maintaining a repository of arbitral awards made in India etc.
The constitution of the Arbitration Council of India as comprising of the Chairperson, a Chief Executive Officer and various members has also been laid down in perfunctory detail. For greater clarity on the exact scope of the powers and functions of the Arbitration Council of India, and its internal constitution, one would have to await the introduction of the relevant regulations in this regard which the Central Government has been empowered to frame and prescribe.
The following Act of Parliament received the assent of the President on the 9th August, 2019. An Act further to amend the Arbitration and Conciliation Act, 1996.
Unlike the 1996 Act or the 2015 Amendment, wherein there were no specific qualifications prescribed for being appointed as an arbitrator, aside from the general requirements of independence and impartiality, the 2019 Amendment has introduced the Eighth Schedule which specifically provides that only a certain specific class of persons holding certain qualifications would be eligible to be accredited as an arbitrator including advocates, chartered accountants, cost accountants and company secretaries [all with 10 years of experience] or officers of the Indian legal service, or officers with a law degree or an engineering degree [both in the government and in the private sector with 10 years of experience], officers having senior level experience of administration [both in the government and in the private sector with 10 years of experience], or a person having educational qualification at the degree level with 10 years of experience in a technical or scientific stream in the fields of telecom, information technology, intellectual property rights or other specialized areas [both in the government and in the private sector].
The ability to be an arbitrator is therefore expressly tied-in with qualification and experience. There are a few more vague general norms applicable to arbitrators, which primarily deal with their impartiality and independence and their legal and practical competence to be able to render a reasoned award and their understanding of the applicable law and best practices.
Significantly, any person having been convicted of any offence involving moral turpitude or an economic offence would fall afoul of these norms. However, both these qualifications and norms, are introduced by the 2019 Amendment in relation to Section 43J which pertains to accreditation of arbitrators by the Arbitration Council of India. There does not seem to be any express reference to the incorporation of these parameters in the existing Fifth Schedule or the Seventh Schedule, meaning thereby that for the moment there is no proscription against persons not falling within the parameters as specified in the Eighth Schedule being appointed as arbitrators.
The Arbitration and Conciliation (Amendment) Bill, 2019 was passed by the Rajya Sabha on July 18, 2019, and by the Lok Sabha on August 1, 2019 and received the assent of the President on the 9th August, 2019
Schedule has been inserted specifying qualifications and experience of Arbitrators and it has been provided that a practicing Company Secretary having 10 years of experience can also become an Arbitrator.
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